How to Choose the Right Credit Card for You

Credit Card Reform Legislation Would Tighten Rules On Rates And FeesMany people fall into debt as the result of charging too much to their credit card(s). In general, credit cards should be used to buy things you need or want to make payments on—not to buy things you want but can’t afford.

While some people choose not to have one at all, having a credit card is almost a necessity in today’s economic environment. Many young people apply for credit cards to begin building credit in the hopes of one day securing a loan to buy a house, car or a even a small business. Having a credit card and using it responsibly are great ways to manage your money, but with so many to choose from, how do you know which is the right fit for you?

Check out these tips for choosing the right credit card!

1. Check your credit score. When choosing a credit card, you first need to see which ones are available to you. If you have a low credit score, it may be the ones with sky-high interest rates and baseline spending limits due to your credit history. While making purchase and paying them off with a credit card will help boost your credit score, you may want to consider other ways to improve your credit.

2. Don’t get blinded by rewards. In the colorful world of marketing, there are hundreds of impressive commercials about travel rewards and cash back. However, be sure to read the fine print. Advertisements fail to mention important information like annual fees, minimum payment requirements, penalties and reward caps.

3. Consider your lifestyle. There are several specialty credit cards that are geared toward specific groups like college students and small business owners. If you travel a lot for business, check for cards with point systems that reward you for hotel stays, airfare and car rentals. If you are a stay-at-home mom or dad, consider cards that allow you to earn points on gas and groceries.

No matter which card you choose, make sure you pay your bill on time to avoid penalties and high interest rates.